Twitter Struggling To Articulate Its Payments Strategy

It’s no secret Twitter wants to be the next big player in E-commerce, but it is a mystery, at least to those listening in to Monday’s (Oct. 27) call with investors, how. Some three-and-a-half months after buying CardSpring, a payments infrastructure firm, company executives had nothing to offer in terms of payments leadership, strategy or even a general direction.

“The CardSpring acquisition is definitely related tying that team together around our ongoing commerce efforts. I wouldn’t extrapolate too much from what you’ve seen around the buy now button that we’ve launched on Twitter to any forward-looking expectations,” said Twitter CEO Dick Costolo. “We’re continuing to explore the way we think about in-the-moment commerce and now commerce and the different kinds of opportunities we see in that area and we’ll just continue to play around with exploration there and look at opportunities in that area as opposed to what thinking about what you’re seeing today as what we’re launching permanently.”

What’s also not clear is how those company’s products can merge into making Twitter a a true payments-enable social network. Dick Costolo was questioned Monday (Oct. 27) during the company’s third-quarter earnings call about how the “Buy Button” and CardSpring are going to work together, but Costolo said there shouldn’t too much focus placed on today’s experimental efforts in terms of what Twitter will be able to do long-term in the e-commerce world.

“We’ve already given users the ability to get deals and discounts, surprise someone with a coffee, or even add items to their online shopping cart — all directly from a Tweet,” according to how Twitter itself described its CardSpring acquisition.” As we work on the future of commerce on Twitter, we’re confident the CardSpring team and the technology they’ve built are a great fit with our philosophy regarding the best ways to bring in-the-moment commerce experiences to our users. We’ll have more information on our commerce direction in the future.”

As for Twitter’s earnings report, figures met analysts expectations but didn’t impress and its stock fell 10 percent after third-quarter earnings were released. Revenue totaled $361 million, and increase of 114 percent from last year’s report of $169 million. GAAP net loss was $175 million, compared to a net loss of $65 million in last year’s third quarter. GAAP net loss for the third quarter of 2014 included $170 million of stock-based compensation expense. Advertising revenue totaled $320 million, an increase of 109 percent from last year and mobile advertising revenue was 85 percent of total advertising revenue.

Other highlights the company promoted were: average monthly active users were 284 million, an increase of 23 percent from last year. Timeline views reached 181 billion, an increase of 14 percent from last year.

“We had another very strong financial quarter,” Costolo said in the earnings release. “I’m confident in our ability to build the largest daily audience in the world, over time, by strengthening the core, reducing barriers to consumption and building new apps and services.”